Matt WilbanksCloud Specialist

THE NEW EDGE IN TECHNOLOGYGREAT CUSTOMER SERVICE

August 9, 2011

Safe Harbor StatementThis presentation contains forward-looking statements that involve risks, uncertainties and assumptions. If such risks or uncertainties materialize or such assumptions prove incorrect, the results of Rackspace Hosting could differ materially from those expressed or implied by such forward-looking statements and assumptions. All statements other than statements of historical fact are statements that could be deemed forward-looking statements, including any statements concerning expected operational and financial results, long term investment strategies, growth plans, expected results from the integration of technologies and acquired businesses, the performance or market share relating to products and services; any statements of expectation or belief; and any statements or assumptions underlying any of the foregoing. Risks, uncertainties and assumptions include infrastructure failures, the continuation or further deterioration of the current difficult economic conditions or further fluctuations, disruptions, instability or downturns in the economy, the effectiveness of managing company growth, technological and competitive factors, regulatory factors, and other risks that are described in Rackspace Hosting’s Form 10-K for the year ended December 31, 2010, filed with the SEC on February 22, 2011 and in Rackspace Hosting’s Form 10-Q for the quarter ended March 31, 2011, filed on May 10, 2011. Except as required by law, Rackspace Hosting assumes no obligation to update these forward-looking statements publicly, or to update the reasons actual results could differ materially from those anticipated in these forward-looking statements, even if new information becomes available in the future.

 

Non-GAAP Financial MeasuresPlease note that certain financial measures used in this presentation, such as adjusted EBITDA , are expressed on a non-GAAP basis. Adjusted EBITDA has been adjusted to exclude charges relating to stock-based compensation. Our GAAP results and GAAP to non-GAAP reconciliation can be found in this presentation, and have been posted on the Investors page of our website, which is found at www.rackspace.com.

Trademarks and Service MarksRackspace® and Fanatical Support® are our registered service marks. Other trademarks and tradenames appearing in this presentation are the property of their respective holders. We do not intend our use or display of other companies’ tradenames, trademarks, or service marks to imply a relationship with, or endorsement or sponsorship of us by, these other companies.

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NYSE: RAX

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• Founded: 1998 / IPO 2008

• Headquarters: San Antonio, TX Offices: Austin, TX

San Francisco, CABlacksburg, VALondon, UKAmsterdam, NLHong Kong, China

• Data Centers: San Antonio, Dallas, Chicago, Virginia, London, Hong Kong

• 3,400+ Rackers

• 140,000+ Customers

• 70,000+ Servers Online

$57 $87$139

$224

$362

$532

$629

$781

2003 2004 2005 2006 2007 2008 2009 2010

Annual Revenue ($M)

45% CAGR

2008, 2009 & 2010

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SIZING THEMARKET: HOW

BIG?

Forrester, “Sizing the cloud,” March 2011

$72B

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*Source: Jack of all Clouds blog: http://www.jackofallclouds.com/2011/01/state-of-the-cloud-january-201/

THE RISE OF THE ENTERPRISE

CLOUDToday, less than 2% of the top 500,000 web sites are hosted on modern Cloud

architectures*

“By 2012, 20% of businesses

will own no IT assets.”

- Gartner Key Predictions, Jan. 2010

THE RISE OF THE ENTERPRISE

CLOUD “Midsize businesses that plan to adopt cloud computing by 2012 expect it to lower their costs by approximately 24%”.

- Gartner Survey Analysis: North American Midsize Businesses Cite Cloud Intentions -

Jan 2011

“Today, we’ve got 95% of applications running internally and 5% externally. In five years, that

ratio will be 80 percent internal and 20% external.” -CIO, Fortune 500

financial company.SandHill Group, Leaders in the Cloud

(March 2010).

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WHY THE

SWITCH?

Cloud technologies make IT Hosting more attractive

AccessibilitySpeed

Cost

PARADIGM SHIFT– Companies will consume IT over the web from service providers: radically less expensive; automated; non-core/strategic

CLOUD COMPUTING – New set of technologies that make existing market opportunity larger and rapidly accelerate this paradigm shift

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OUR STRATEGY IS

SIMPLE

The #1 Specialist in Hosting and Cloud computing

Fanatical Support makes us themost trusted partner for business

Open technologies at web scaleEnsure value and reliability

Service Enables CLOUD

ADOPTION

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i OUR OFFERA PORTFOLIO APPROACH

Fanatical Support

Hosting + Cloud Portfolio

Choice of Service Levels

Leading SLAs

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PROVEN BUSINESS MODEL DRIVES FINANCIAL PERFORMANCE

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Dedicated Private Cloud Public Cloud OpenStack (off premise)

Critical Sites

Intensive

Managed

UnmanagedRe

turn

on

Ca

pit

al

Se

rvic

e I

nte

nsit

y

Infrastructure Efficiency

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Things go Wrong in Computing13

Hold it Like This

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nexus oneHelp

“Enter your information in the fields below and click 'Submit' to send an email to the Nexus One Team. We'll use the information you've provided to address your inquiry. We can't promise a personal reply to each email, but will contact you only if we

require more information. “

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Airing Our Mistakes on YouTube

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I think I heard you say, “Duck You.”

Press “1” if this is correct.

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“It’s supposed to be hard. If it wasn’t hard, everyone would do it.”

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Hiring: Talent and Culture Fit Really Matter

Seamless: Great Technology + Human Performance

Transparency: Open Management, Open Book

Strengths-based Management

Celebrating Fanatical Rackers

Racker Engagement

Customer Loyalty - Net Promoter Score

Talent

•Motivation•Influence•Workstyle•Relationship•ThoughtProcess

Hiring: Talent and Culture Fit Really Matter

MotivationInfluenceWorkstyle

RelationshipThoughtProcess

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CULTURE IMMERSIONROOKIE O

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Seamless: Great Technology + Human Performance

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TRANSPARENCYOPEN BOOK

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FIND WHAT’S RIGHTSTRENGTHS-BASED MANAGEMENT

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Celebrate

The

Fanatical

Racker

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KEEPING OUR FINGER ON THE

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%Promoters

Net Promoter Score (NPS)

minus

0-6

7-8

9-10

Extremelylikely

Extremelyunlikely

%Detractors

WOULD YOUR REFER A FRIEND?NET PROMOTER SCORE

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Matt Wilbanksmw@rackspace.comOffice: (210) 312-5464www.rackspace.com

@MWilbanks

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